Anthony John Page and Another v Hewetts Solicitors and Another
| Jurisdiction | England & Wales |
| Judge | Mr Justice Hildyard |
| Judgment Date | 20 September 2013 |
| Neutral Citation | [2013] EWHC 2845 (Ch) |
| Docket Number | Case No: HC09C00480 |
| Court | Chancery Division |
| Date | 20 September 2013 |
[2013] EWHC 2845 (Ch)
The Hon Mr Justice Hildyard
Case No: HC09C00480
IN THE HIGH COURT OF JUSTICE
CHANCERY DIVISION
Royal Courts of Justice
Strand, London, WC2A 2LL
Graham Platford (instructed by Cavershams Solicitors Limited) for the Claimants
Dan Stacey (instructed by Hewetts Solicitors for the First Defendant and by Henmans LLP for the Second Defendant)
Scope of preliminary issue, and its direction by the Court of Appeal
The principal events to which the claims in this action relate took place in early 1999. The claims are for breach of the duties owed in contract and/or tort by the First Defendant (a firm of solicitors) and the Second Defendant (a legal executive in that firm) when acting in and about the sale of the principal asset of the estate of which the Claimants are administrators ("the common law claims"); and for dishonestly procuring or assisting in an innocent breach of trust by the First Claimant in advising him to sell that asset (his deceased parent's home at 262 Kidmore Road, Caversham, Reading, Berkshire, "262") at an undervalue to an entity associated with the Second Defendant ("the secret profits claim").
Unsurprisingly, issues have arisen as to whether the claims are barred by the Limitation Acts. These issues have already travelled to the Court of Appeal. In consequence the common law claims originally advanced have been struck out: it was held at every level (by the Master, by Ms Susan Prevezer QC, sitting as a Deputy High Court Judge, and in the Court of Appeal) that the Claimants' common law causes of action (if any) accrued on the date of the sale of 262 on 12 March 1999, alternatively (and at latest on about 23 November 2000) by which time (at latest) the material facts giving rise to the claim were known to the Claimants and thus became statute-barred well before the claim was brought. Only the secret profits claims remain.
The secret profit claims themselves give rise to a variety of issues as regards the Limitation Act 1980:
(1) whether the claims were brought within 6 years of the last date on which the Claimants can have obtained sufficient knowledge of the material facts giving rise to the claims;
(2) whether, if not, any secret profit received by the Defendants was trust property, such that by virtue of section 21(l)(b) of the Limitation Act 1980 no statutory limitation period applies.
In the context of an application either for summary judgment or to strike out the claims, both the Master and Ms Prevezer QC answered both questions in the negative and concluded accordingly that the claims were barred and fell to be dismissed.
There being no appeal against the factual finding that the Claimants knew sufficient about the sale at an undervalue to start time running in November 2000, the Court of Appeal concluded that the common law claims were time-barred and must be struck out.
However, they reversed the decision of Ms Sue Prevezer QC (and Master Bragge before her) so far as it related to the secret profit claim. They did so on the basis that in that context, and although there was no challenge to the finding below that time began to run on the secret profits claim on 6 February 2003, the resolution of the first question required a factual analysis as to whether the claim had been "brought" within six years after that date, which could not be done summarily and required a trial.
On that basis, the Court of Appeal preferred not to consider the second question unless and until it became necessary to do so: if, as a matter of fact, the secret profit claim had been "brought" within those six years, the second question (which raises difficult issues of characterisation, and the boundary between personal and proprietary bases of claim) would not arise, since no resort to section 21 of the Limitation Act 1980 would be necessary.
Accordingly, the Court of Appeal adjourned consideration of the second question and directed a trial of a preliminary issue in a form calculated to answer the first question, namely:
"on the assumption that the limitation period of six years began to run on or about 6 February 2003 whether the proceedings were brought within the limitation period."
If the answer to that preliminary issue is 'yes' then it will be unnecessary for the Court of Appeal to consider the application of section 21; if the answer is 'no' then (subject to one point later addressed) the matter will have to be remitted back to the Court of Appeal.
Summary of conclusion
In my judgment, the answer is 'no.' The purpose of this judgment is to explain that conclusion, reached after a one-day trial of the preliminary issue (which extended to cross-examination of the witnesses called at that trial).
Relevant facts
I do not think it necessary or appropriate to recite the background facts (or more accurately, the facts as they have been assumed to be for the purposes of the previous hearings). Those facts have been set out in paragraphs 2 to 8 of the judgment of Lewison LJ (with which the other members of the Court of Appeal, namely Smith and Laws LJJ agreed). The focus of the factual inquiry for the purposes of the preliminary issue is more limited:
(1) when were the documents relied on by the Claimants as constituting their request to the court for the issue of their Claim Form actually received by the court?
(2) were the documents received in good order for issue and accompanied by the appropriate fee?
Many of the facts relating to these specific questions have already been addressed previously too. Furthermore, many are not contested. But I turn to address each of these matters in turn, having now had the benefit of further written evidence and also oral evidence and cross-examination on the limited areas of disputed fact (which those who have dealt with these issues in the past had not). It is also necessary to address certain matters not previously relied on by the Claimants, as identified below.
The facts relied on by the Claimants in this context are set out in four witness statements of Robert Arthur Charles Last ("Mr Last"), the senior solicitor in the firm of Cavershams who has had the conduct of this matter for the Claimants since February 2007.
Those witness statements seek to explain the difficulties in the conduct of the administration (including delay in arranging the retirement of the Claimants' predecessor as Administrator, a Mr Robert Watsham) which caused the Claimants (in the words of Mr Last) "to run perilously close to a possible limitation date, in December 2008"
More particularly, Mr Last has there explained that it was not until 3 December 2008 that the Claim Form and Particulars of Claim were completed and (according to that evidence) then sent the same day in four bundles to Court by DX, with a cheque in the sum of £990 (that amount being of relevance in the context of the second question adumbrated above, to which I later return).
Mr Last exhibited a copy of his covering letter to the Court Manager at the Royal Courts of Justice (dated 3 December 2008). That letter contained a request that the Claim Form be issued but not served, and returned to Cavershams so that they could effect service themselves in due course. This latter request (in capital letters) was made because at that stage Mr Robert Watsham was still in office and he was not willing for proceedings to be brought in his name: Cavershams therefore needed a bit more time to regularise that position, having (so they thought) protected the position as regards any limitation bar: the four months before service was required seemed necessary and sufficient.
The court, for its part, has no record of having received any of those documents (including the cheque).
Since the first crucial factual question that I must determine is whether that letter and its attachments were indeed ever received by the court (and, if so, when) it assists to set out Mr Last's evidence as to the steps taken in this case and, more generally, the procedure in his office for the sending of such documents in his own words:
"7 …. I did not personally take the documents to the DX box and my firm keeps no positive record of committal to the DX but, if the documents had not been committed to the DX, they would have remained in the firm's offices: and they did not
8. The experience in my firm is that papers committed to the DX before the close of business on any working day almost invariably arrive in the addressee's DX box the following morning. Accordingly, I believe that the claim form and letter of request was most probably received in the court office on Thursday 4 th December 2008 and certainly no later than Friday 5 th. We heard nothing from the court in the immediate future, but that did not surprise us because previous dealings in the Chancery Division, both enquiries made in this matter before issuing, and in other matters, was that one did experience very considerable delays. For example I telephoned the Chancery Division with a query on 1 st May 2008, and followed up with a letter the next day (and again on 27 th May, the Court having lost the first letter) and it was not until 23 rd October, some five months later, that I received a substantive reply.
9. However, by mid-January 2009, I felt I should enquire of the court where the sealed copies were, and the answer was that the court had no trace of them. A check with our accounts department confirmed that our cheque had never been presented, so we then cancelled that and issued a fresh cheque along with a further four bundles of documents. Those documents were copies of the documents...
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